>
> If retailers issue their own credit cards, they're capturing profits that
> used to go to their bankers. And they've been doing that for a long time.
>
> Doug
They control the cash registers, so they can see the money that´s flowing, and they see (or can calculate) the interest rate the credit cards are making on those amounts, so it´s just a matter of time that one day their light bulb lights up and they say "hey, we could get into the same business as these guys!".
It´s the same as all those e-commerce firms like Paypal who think they can become big shots in the money transfer business... They are only middle-men and require the services of credit cards, which can ultimately see all the transactions from their customers passing through paypal.com and it´s only a matter of time until one day their light bulb lights up and they say "hey, we could get into the same business as these guys and cut the middle men!".
That´s how Visa´s "card-to-card" service was born. (money transfers between people´s Visa cards)
Moral of the story: You should control the infrastructure. The cash registers, or the actual credit cards. (or in the case of Google, the Cloud and the servers it runs on).
FC